Mobile Diner® where wireless and washington meet….

The buzz building up to the iPhone launch was unprecedented in the wireless industry.  It reached a climax on Friday night when the product was rolled out.  Besides the touch screen and revolutionary style – the iPhone will change the industry forever.  On that note, I wanted to wait a few days to make some comments because the impact will be incremental but significant.  I believe the benefits for the wireless carriers downstream will outweigh the costs.  However, change is hard and it will take time for some executives to see the opportunity.  The length of the exclusive deal (2 years) with AT&T is about all the time they have. Continue Reading »

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The Wall Street Journal did a story today on T-mobile and their game plan for Wi-Fi.  As many wireless enthusiasts know, T-mobile has been rolling out Wi-Fi hotspots throughout the country (most notable in Starbucks).  I enjoyed the article because it focused on the opportunities that are available to T-mobile and not the rhetoric about licensed spectrum versus unlicensed spectrum.

With regard to Wi-Fi, it has often been noted, that once deployed, this technology would be bad for the carriers.  The reason given - that minutes of use will disappear from the cellular network.  The argument would continue that other companies will enter the market and wireless carriers would be doomed…  Absolutely not!

This is a good development for consumers and spuring wireless broadband.  Connectivity for the consumer will be solid and the operator will be saving capacity!  About 60 percent of mobile calls made are fixed and indoors.  If I can offload traffic off the network, I can continue to grow my customer base without worrying about the network deteriorating.  I can also promote more data options.  This strategy also allows other opportunities for T-Mobile.  For instance, small to medium sized businesses (smbs) will be a sure target for T-mobile.

T-mobile is not the only company evolving.  As we know, Sprint will offer Wi-Max as their next generation strategy.  AT&T has more hotspots than T-mobile and spectrum in 2.3 GHz to deploy Wi-Max (if they want).  Verizon Wireless is pursuing FMC (Fixed Mobile Convergance).

Consumers don’t care how they access the internet (or how the call is enabled).  3G, Wi-Fi or Wi-Max are tools for the carriers to utilize.  Each carrier will choose how to incorporate a technology that works with their business plan.  In this new world of mobility and broadband networks the only sure thing - the consumer is in charge and has a computer in their hand…

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Five years ago, the FCC considered eliminating the analog requirement on wireless carriers. At that point in time, I was at AT&T Wireless and we were advocating to policymakers and regulators to end the government mandate. FCC Chairman Michael Powell did not take action and AT&T Wireless was bought by Cingular the next year. Spectrum capacity problems were one of the reasons that AT&T Wireless put itself on sale.

USA Today recently did a story on the issue.  Accordingly, here’s five reasons to keep the sunset date on track (Feb 2008) and unshackle the wireless carriers: Continue Reading »

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Advertising Age reports that Marc Lefar, Cingular’s Chief Marketing Officer, has resigned.

Lefar successfully led the marketing efforts on integrating AT&T Wireless (into Cingular) and has kept the carriers’ perception in the same league as Verizon Wireless.

In any event, I have a few marketing thoughts for AT&T -

(1) Don’t fix it when it’s not broken -

The Cingular brand is powerful and the under-25 demographic has developed an attachment to it. The AT&T brand connects with a demographic that is not going to do much more than use voice and (maybe) text. Data ARPU growth and usage is critical for future wireless success. Developing loyalty with the under-25 demographic will be key to selling more services.

(2) Law of the Ladder –

One of the best marketing books is the 22 Immutable Laws of Marketing. One of the laws is this one. Basically, consumers see products as rungs on a ladder. Verizon Wireless has a solid network perception in the industry (a top rung). Cingular is a rung below but has made great progress over the years. What was AT&T Wireless’ network perception before it was bought — not good. I think that by going back to AT&T – “Mobility” or “Wireless” takes the brand back in time.

(3) Keep the Orange –

It is clear that the Cingular brand will be shelved. However, AT&T should incorporate some orange on its wireless venture. It has value!

With the iPhone set for release in June, Cingular has generated some incredible buzz for this product. Now is not the time to confuse consumers and junk a successful brand.

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The wireless industry has been an active participant in recycling and protecting the environment.  However, you would never know it. 

After painfully searching, I did find that all four national carriers have some sort of FAQ sheet on recycling (Cingular, Sprint, T-mobile, Verizon Wireless).  I just can’t figure out why one of them has not embraced it to build a competitive advantage.

News Flash — Green is in….  Ask Honda and Toyota about what a green reputation can do for your business.  Ask Al Gore what it can do for your career.  Besides making an effort to be a good corporate citizen it can be a way to attract consumers.  Accordingly, there is a huge opportunity here for a carrier to be an industry leader. 

Earth Day is on the horizon.  It would be great time for a leader to emerge and derive all the benefits/value of green.

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Some people just can’t get a break. 

At their LA show last September, CTIA announced the launch of the Text 2Help initiative.  Text 2Help allows customers of participating carriers (Alltel, AT&T, Boost, Dobson, Sprint, T-Mobile, and Verizon Wireless) to donate $5 to the Red Cross in natural disasters just by texting the word “GIVE” to the number “2HELP.”  A $5 charge is added to the customer’s next wireless bill, and 100% of the donations go to the Red Cross for use in disasters like Katrina. 

Sounds good, right?  A little corporate philanthropy going a long way for a good cause…

Not according to the Foundation for Taxpayer and Consumer Rights.  FTCR has written a letter condemning the program as a profit scheme masquerading as a fundraiser devised by the carriers, based on the fact that standard text messaging fees still apply for all donations (although some have apparently waived the fees).  The New York Times picked up the story yesterday, adding some unfortunate negative publicity to the program.

Should the carriers have waived fees associated with donating to a charitable organization?  Probably.  But I think FTCR is missing the point here. 

Say 200,000 people were to donate $5 each through Text 2Help in the aftermath of the next major natural disaster.  That would yield $1 million for the Red Cross.  At roughly 10 cents per text, the seven carriers would make a collective profit of $2000 from the text messages, averaging less than $300 each.  (That is assuming that people have not purchased unlimited texting plans, which many have.)  SMS revenues for 2006 were $15.2 billion $5.6 billion.  Text 2HELP revenues are just a drop in the proverbial hurricane for the carriers, and it is a shame that such a worthwhile program should attract such criticism simply becaue it was launched by the carriers.

Update: This post has been edited.  

Full Disclosure on the dish: Our firm represents CTIA, Verizon Wireless, and AT&T.

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My cellphone became ill in January. I remember the occasion quite well. I was in Baltimore and the Ravens just got beat by the Colts in the playoffs. It was a somber occasion because it marked the second time in my life that the Colts broke my heart (but that is a different story). As I turned my phone on in the cab and my Samsung SCH-a950 started to come to life, a football-shaped black spot appeared on the screen. I didn’t know if my colleague (who is a Colts fan) had somehow sabotaged it or what had happened. Unfortunately, the black spot would not go away and it has appeared sporadically over the last three months (this has made text messages impossible to read). After a valiant three month fight, my phone succomed to this infection (or Colts curse) last week and died. Accordingly, I have been without a phone for almost a week…

Not having a cellphone is very uncool. With regard to work, I often like to show the latest technology to policymakers and staff. I think it is important to demonstrate the innovation that is occuring everyday in wireless – turning on an old brick phone is not an option. On a social level, these gadgets define us and not having a cellphone or explaining that my cellphone recently died is unacceptable. It also annoys your friends who are trying to contact you and being unreachable is unacceptable as well.

I’ll eventually get to the store and buy myself a new gadget. Verizon Wireless’ (they are a client) current inventory is not all that great but I do like the Samsung 990 phone and the quality of the network. It has a 3.2 megapixel camera and shoots video as well…. If my phone could only have just made it to June (AT&T is also a client)….

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I was watching the nightly news last week and saw this story about Cellphones for Soldiers.  Cellphones for Soldiers was started by two teens in Massachusetts who heard a story of a soldier who had a large phone bill and they wanted to help.  Accordingly, they recycle phones and use the recycling money to buy phone cards for the troops.  On that note, glad to see AT&T join their mission.

I’ve got a few old phones laying on my desk and I know what I’m going to do with them.  If you have some spare phones laying around — please help the cause.

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An Amendment to H.R. 401 - Metro Authorization legislation – has been delayed until after the Easter recess.  Specifically, the amendment would mandate that WMATA allow access to wireless carriers to upgrade or install their equipment in the Metro.  The amendment authors are Committee Chairman Henry Waxman (D-CA) and Tom Davis (R-VA) ranking member of the House Committee on Oversight and Government Reform.

The Metro authorization bill (H.R. 401) would provide $1.5 billion to operate and upgrade the subway.  The amendment to the underlying bill would allow all carriers the opportunity to serve consumers underground.  Currently, if you are a GSM subscriber, you will not have wireless service in Metro (unless you have a GSM phone that has analog and those are rare).  Verizon Wireless is currently the only operator that provides service.  Sprint users and those that still have TDMA phones can roam on Verizon’s network.  

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We all know Sprint is bleeding valuable consumers to at&t and Verizon.  We also know their reband with public safety is taking longer and could be more costly than originally estimated.  However, I believe if Sprint can weather this storm and regain confidence from consumers – their future could be bright.

Sprint’s 4G plans center on WiMax and they will utilize 190 MHz of spectrum in the MMDS band to deliver the service.  This spectrum covers 85 percent of households in the top 100 markets.  Sprint also benefits from an existing PCS infrastructure that sets up quite well to overlay WiMax and they have capital committed to the initiative.  As Barry West, Sprint’s CTO, stated at CTIA’s show in Orlando “we are the 800-pound gorilla.” 

I like Sprint’s vision for wireless broadband.  I would have liked it even more if they had implemented and executed this strategy a few years ago.  However, it is imperative that they get their churn under control.  When I was at AT&T Wireless, our customer base was growing but the quality of the network was diminishing.  We had a capacity problem.  Suddenly churn became a real issue (because we couldn’t get more spectrum or chop the cells up for reuse any more) and a negative perception of our services became viral in the market.  Sprint must stop the loss of their valuable postpaid subscribers or the benefits of delivering a cheaper bit and faster broadband will never reach its full potential.

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Sprint must be eating at the Mobile Diner. They have recently decided to join the conversation and engage wireless consumers on the internet. I think this is a great development and I hope it is a success.

Buzz About Wireless is a new website by Sprint that seeks to gather knowledge from their customers and others. 24 comments have been submitted on the main page since its launch in February. The site also directs readers to 2 main topic pages: ratings & reviews and discussions.

I believe there is a real opportunity for a carrier to “win on service.” T-Mobile has been a leader in customer service in some JD Power surveys. However, they have not leveraged it in their marketing. With regard to service quality (“can you hear me now”) and quality of the network, Verizon owns it. Cingular is trying to compete on the quality of the network – “fewest dropped calls” – but they are on playing on Verizon’s turf. Not to mention folks are still confused with the whole AT&T Wireless rebrand.

I hope other carriers will follow Sprint’s lead on this initiative. Obviously, Sprint will not please everyone and some comments will be tough. However, connecting with consumers and creating a sense of belonging can build your brand and will increase ARPU (Average Revenue Per User).

Will Sprint’s efforts be rewarded? Let us know your thoughts….

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Have you ever wondered how to get a deal on your next cell phone?

The Consumerist supposedly has gotten anonymous confessionals from the largest carriers’ (Cingular, Verizon, Sprint and T-Mobile) sales reps. The confessionals offer insight on how to swing a deal the next time you are in the market for a new phone. It’s interesting reading but I’m not sure how much of the intel is legit (on the T-mobile confessional – there is already a rebuttal).

Stay tuned – I plan to do some research on some of these suggestions because a few struck me as far-fetched and I believe could ultimately harm the consumer in the long run.

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While many aren’t aware, most of the phones on the market today come equipped with GPS chips capable of pinpointing the exact location of a phone and its user.  (for a helpful description of how GPS works in cell phones, look here)  And while most carriers have been using these capabilities for E911 purposes only, many are beginning to offer other convenient GPS-based services.

For instance, Verizon and Cingular both rolled out mapping and navigation services for some of their phones last year and Sprint Nextel has been offering TeleNav since 2005.  These services are similar to the navigation systems that are almost ubiquitous in most car models today, but have the advantage that they can be used on foot. Continue Reading »

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Richard Martin, Senior Editor of Unstrung, recently opined that the three largest wireless carriers have no forward looking strategy and are just trying to “hold onto a big stash of gold.” I disagree with his overall assessment of this highly competitive industry.

The logic around his argument seems to center on believing that carriers will just deliver broadband over the cellular network and new WiMax providers (he mentions Clearwire) or WiFi providers (he mentions Google) will render cellular technologies irrelevant. As I have mentioned previously in the diner, carriers recognize (some more than others) that consumers don’t care whether they receive their broadband experience via 3G, WiFi or WiMax. They understand that consumers value mobility and look to provide the best experience possible. If they don’t — consumers will walk. Continue Reading »

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I want an IPhone.  I want one bad.  I know a bunch of other people that want IPhones.  In fact, I usually get asked about Apple’s entry into wireless daily.  Accordingly, I really think other manufacturers are doing themselves a disservice by discounting the IPhone (article here).  I think it is just Apple Envy!

The article has comments from a few analysts and other handset manufacturers.  Basically, they say that the “market is saturated” or “everybody has a cell phone already.”  These analysts and manufacturers are missing it.  Here’s a few things I think they are missing –

(1)  People love their cell phones but they are not attached to them or necessarily their provider.  Look at the success of the Motorola Razr.  Folks saw a device they wanted and dumped their phone.  It was the hottest phone in the market last year.  Today, Sprint can’t give them away.  

(2)  “It doesn’t have disruptive features.”  Did the Razr have disruptive features?  Sexy handsets sell!  Not to mention most consumers still are only starting to utilize the other functionality (wireless broadband) in the phone.  Hopefully, the user-friendly nature of the IPhone will grow the use of other applications.

(3)  “It’s not as easy as buying an IPod.”  What so hard about buying a phone?  I think Cingular absolutely will reap benefits (in terms of adding subs and growing data ARPU) from the partnership from Apple.  I think Verizon Wireless will be fine because they have had tremendous success marketing the strength of their network.  Service quality is still marketable and Verizon owns this niche.

My only complaint about the IPhone is I have to wait until June!

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